Brexit and Securities Finance

At The Field Effect, we specialise in Target Operating Model design and can help you identify how process, function, data, technology, people, revenue, and controls work together in order to deal with the challenges ahead and accelerate the delivery of change.

Brexit will clearly have wide ranging impacts on European and British financial institutions, firms have been preparing for some time now, but challenges remain – especially in the Securities Finance space.

Legal documents: Repapering has typically focused on derivatives contracts, and SecFin ones – such as GMRA, GMSLA, PB and Triparty agreements run the risk of being left to languish in employees draws – these need digitising, assessing for impacts and repapering

Funding arrangements: Firms intercompany funding arrangements are already complex, and new entities or changes to regulatory requirements will lead to increasing complexity, impacting both trading flows and collateral management.

Operating model: Ensuring that your operating model is understood and building in the required changes and flexibility required will be challenging for most firms. The business domain models need to define the future state for people, processes and responsibility

Timing: The timing of Brexit and the approach / scenario that is finally implemented will obviously have consequences

Regulation: a detailed view of the regulatory impacts on the business post SFTR needs to be clearly defined. Traceability of compliance to regulators needs to be evidenced.